Toyota to freeze factory construction

JIJI

Toyota Motor Corp. may stop all new plant construction worldwide for three years starting in April, sources said.

The automaker will instead focus its capital spending on improving productivity and cutting costs at existing plants as it continues to navigate the tough business environment, the sources said.

Toyota is expected to include the investment policy in a new strategy it is likely to release this spring.

Toyota was considering building a new plant in India by 2016 to meet soaring vehicle demand in emerging economies but found it necessary to review its capital spending plans after it was unable to reduce fixed factory costs when the global financial crisis hit in 2008, driving it into the red.

Toyota plans to step up investment aimed at introducing advanced assembly lines that can respond flexibly to changes in demand.

The company will allow new plants now under construction in Thailand and Indonesia to go into operation this year as scheduled.